Ford Settles A Mexican Walkout

By DORON P. LEVIN, Special to The New York Times

Published: February 9, 1990

CHICAGO, Feb. 8—
The Ford Motor Company said today that it had resolved some of its labor problems in Mexico by reaching a tentative contract agreement with workers at an engine plant in Chihuahua.

Separately, Ford said it was continuing to send termination notices to about 2,400 Mexican workers at its assembly plant in Cuautitlan, near Mexico City. And the No. 2 American auto maker said it was in negotiations with workers at its Hermosillo plant, where the labor contract expires on Feb. 28.

A Ford spokesman, Al Chambers, said that the situations at the three plants were not related and that the company was confident that it could reach contract agreements.

Important Subcompacts

Ford's biggest worry may be the Hermosillo plant, where it is preparing to begin production in April of a redesigned line of subcompact cars, the Mercury Tracer and Ford Escort. The Tracer and Escort, which were developed with the Mazda Motor Corporation, are an important element of Ford's strategy for the 1990's.

Ford needs the highly fuel-efficient models to raise its overall corporate average fuel economy and meet higher Federal standards for 1990 models. Moreover, since the Tracer and Escort are new models, any interuption of production could have a devastating effect on their important introductory phase, when the company spends a great deal on promotion.

In Cuautitlan, Mr. Chambers said, the company had begun to hire workers to replace those who were dismissed. Under Mexican law, any worker with more than three unexcused absences in a month can be legally discharged.

About two-thirds of the 3,700-member work force occupied the Cuautitlan plant last month after an intra-union dispute resulted in a shooting in which seven workers were injured and one killed. Mexican police peacefully removed the occupying workers on Jan. 22, Ford said, and many of those who had been in the plant did not return to work after that.

The Cuautitlan plant assembles six Ford car and truck models for the Mexican market.

Much of the labor unrest in Mexico stems from rapid inflation, Mr. Chambers said, adding that the value of the peso has dropped from about four pesos to the United States dollar in 1981 to about 2,700 currently.

The tentative labor agreement in Chihuahua resulted in a 27 percent increase in wages and benefits. In the last week of January, workers left their jobs because there was no contract, the spokesman said. The plant produces engines for Ford Tempo, which is sold in the United States and Mexico, and the Topaz, which is sold in Mexico.